Homeowners on the Move Are Choosing More Affordable States
Homeowners on the Move Are Choosing More Affordable States
Eric Risberg/AP Photo
Homeowners making moves out of state are increasingly selling out of expensive markets like California, where price escalation is steep, and buying into lower-cost markets such as Texas and Arizona, according to an analysis by data company CoreLogic.
Overall between 2000 and 2015, 2½ home sellers left California for every out-of-state buyer coming into the state, the study found, whereas in Texas, Arizona and North Carolina there have been more buyers coming than sellers leaving. That trend has accelerated as the housing recovery has progressed, with out-migration increasing among homeowners in fast-appreciating markets like California and Colorado, and decreasing in more affordable markets such as Texas.
“When most people move, they’re either moving for opportunity or affordability,” said Sam Khater, deputy chief economist at CoreLogic, who analyzed the data. “Moving across state lines you get a little bit of both. I can leave a place that’s expensive and rapidly appreciating, and I can get a job that pays the same or is better, but the cost of living is lower.”
The study drew on public records data that tracks and matches those selling homes in one state and buying in another over time, providing a window into regional patterns in mobility and price disparity. Though more owners are moving out of states like California than moving in, the overall percentage of sellers that move to another state has declined since 2008 across the U.S., according to CoreLogic.
For all homeowners who moved across state lines between 2000 and 2015, prices were appreciating significantly faster in the markets where they sold homes than where they ended up buying, the data showed. Prices increased 62% on average over that time in areas where movers sold homes, compared with a 37% price increase in markets where they moved.
California offers a prime example. The median sale price for homeowners leaving the state was $495,000, compared with a median purchase price of $315,000 in the markets where they moved—a 36% decrease.
For Californians moving to Texas, the gap was even wider: a $510,000 median selling price in California compared with a $307,663 purchase price in Texas—a drop of 40%.
Sahar Pezeshki, a Dallas-area agent at the real-estate brokerage Redfin, said she has seen Californians “coming in by the busloads” to Texas in recent years. The reasons run the gamut—job relocations, retirement—but she said most buyers are chasing the significant cost savings.
One recent client sold his condominium in west Los Angeles and discovered he had the money to buy two new homes in Dallas—one for him and one for his daughter.
“We can’t compete with the beaches of California,” Ms. Pezeshki said. “But when you have enough leftover money, you can go travel there once a month.”
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